DHP India Limited

Industrials — Tools & Accessories · BSE

₹487.00−₹3.15 (−0.64%)

DalalBaazaar Score

48 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by high debt relative to equity, micro-cap size, which brings thin liquidity.

In simple words: The business is earning a fairly low return on the money invested in it, with modest growth. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:47 pm

Understanding the Business

Company site ↗

The 60-second version of DHP India Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

DHP India Limited manufactures and sells liquefied petroleum gas (LPG) regulators, accessories and parts, and other brass fittings in India. It also exports its products. DHP India Limited was incorporated in 1991 and is based in Kolkata, India.

IndustryTools & Accessories

SectorIndustrials

Employees218

Annual revenue₹62 Cr

How does it make money?

Turns over ₹62 Cr a year. Of every ₹100 of sales, about ₹18 reaches shareholders as profit, with ₹30 left at the operating level before interest, tax and depreciation. Each of its 218 employees supports ₹28.3 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹28.3 lakh

Who are its competitors?

The closest listed comparisons in its industry are LARSEN & TOUBRO LTD., SIEMENS LTD, ABB INDIA LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of 6.7% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

Peer median ROE15.2%

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved -35% while net margin moved -28% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect-35%

Margin effect-28%

DalalBaazaar Score

48/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 13.2% a year
✗ Profit has declined at 22.1% a year

Quality vs. Valuation

Company Quality

47/ 100

Average

How good the business is, ignoring the share price entirely.

Valuation

57/ 100

Fair

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

13.1x

3Y Median

6.8x

40 monthly readings · mean 7.1x · range 2.0x–13.8x

Sector Median

88.8x

median of 3 sector peers

⚠️Current valuation is approximately 93% above its 3y median of 6.8x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

🟢Against its sector it trades 85% below the peer median of 88.8x.

vs. its own history

Expensive

6.8x median over 40 months · +93%

vs. sector peers

Cheap

88.8x median of 3 peers · -85%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

8.3x

PEG

4.50

What's Good / What's Bad

🟢 What's Going Well1

Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 13.6% to 4.7% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 18.0% to 6.7% — often a sign of competition or overexpansion.

Red Flags

4 items require attention · 3 high · 1 watch

🔴High leverageFinancial
Debt/Equity of 2.77x — earnings must service borrowings before shareholders see anything.
🔴Significant margin compressionFinancial
EBITDA margin has fallen 7.2 points, from 36.9% to 29.6%.
🔴Receivables growing faster than salesFinancial
Receivables up 152% against revenue up -35% — sales are being booked faster than they are collected.
🟡Profit is decliningFinancial
Net profit is down 53% over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Cheaper than its peers
It trades 85% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Margins are being competed away
EBITDA margin has fallen from 36.9% to 29.6%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Leverage amplifies any setback
Debt/Equity of 2.77x. Interest is payable whether or not the business has a good year.
Sales are being booked faster than collected
Receivables are up 152% against revenue up -35%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
The price already assumes success
The stock trades 93% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
Returns on shareholder capital are falling
ROE has dropped from 13.6% to 4.7%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 28%✓ 29.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✓ ₹9 Cr
Profit that never becomes cash eventually stops being profit.
3Debt / EBITDA stays below 2x✓ 0.4x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4ROCE stays above 8%✗ 6.7%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Valuation vs its own median of 6.8x✗ 13.1x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

7 / 11 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✓ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✗ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

4 good · 4 neutral · 3 weak

Market Cap

₹146 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

13.1x

Cheap

Cheap against the generic band

P/B Ratio

0.62x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹37.3

Profitable

Profitable on a per-share basis

ROE

4.7%

Weak

Weak capital efficiency

ROCE

6.7%

Weak

Low return on total capital employed

Debt/Equity

2.77x

High

High leverage

Revenue Growth (YoY)

8.0%

Modest

Modest growth

Profit Growth (YoY)

2.9%

Modest

Slow profit growth

Dividend Yield

0.82%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

₹9 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

8.3x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

33.7%

Good

Healthy core-business profitability

Net Margin

18.0%

Good

Strong bottom-line conversion

Current Ratio

17.57

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.10

Defensive

Steadier than the market

52W Range Position

28%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

497.1 / 506.2

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

40.0

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹94 Cr	₹46 Cr	₹50 Cr	₹62 Cr	-13.2%
EBITDA	₹35 Cr	₹8 Cr	₹11 Cr	₹18 Cr	-19.3%
EBITDA Margin	36.9%	17.9%	22.6%	29.6%	—
PAT (Net Profit)	₹23 Cr	₹26 Cr	₹67 Cr	₹11 Cr	-22.1%
EPS	₹78.1	₹88.02	₹221.78	₹36.86	-22.1%
ROE	13.6%	12.2%	27.9%	4.7%	—
ROCE	18.0%	14.1%	33.2%	6.7%	—
Total Debt	—	₹5 Cr	₹4 Cr	₹7 Cr	—
Free Cash Flow	₹33 Cr	-₹1 Cr	-₹8 Cr	₹9 Cr	-35.4%

🔴 Revenue has shrunk at 13.2% a year over 3 years.

🔴 EBITDA has shrunk at 19.3% a year over 3 years.

🔴 EBITDA Margin has fallen from 36.9% to 29.6% over 3 years (-7.2 pts).

🔴 PAT (Net Profit) has shrunk at 22.1% a year over 3 years.

🔴 EPS has shrunk at 22.1% a year over 3 years.

🔴 ROE has fallen from 13.6% to 4.7% over 3 years (-8.9 pts).

🔴 ROCE has fallen from 18.0% to 6.7% over 3 years (-11.3 pts).

🔴 Free Cash Flow has shrunk at 35.4% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹249 Cr

Total Liabilities

₹12 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹10 Cr

Capex

-₹1 Cr

Shareholding (proxy)

Institutional Holding

10.2%

Insider Holding

75.4%

Corporate Actions

Dividend Rate

₹4

Ex-Dividend Date

11 Sept 2026

Peer Comparison

Company	P/E	ROE
LARSEN & TOUBRO LTD.	30.1x	15.2%
SIEMENS LTD	88.8x	10.5%
ABB INDIA LIMITED	92.6x	19.1%

Recent News

6 general

Compare with DHP FINANCIA

Equitymaster, 14 Oct

Counter Cyclical Investments raises DHP India stake to 10.37% via open market buy

scanx.trade, 14 Oct

DHP India Ltd. Peer Comparison – Compare with Others

Value Research, 31 Aug

DHP India Ltd. Key Financial Ratios – Valuation, Profitability & More

Value Research, 31 Aug

Dabriwala Constructions sells 529 shares of DHP India on open market

scanx.trade, 25 Sept

DHP India Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 31 Aug

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongFinancial Health · Valuation

MiddlingBusiness Quality · Profitability

WeakGrowth · Risk

Points for each in the Score ↑

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 3 high-severity red flags sit above this conclusion and should be read first.

2 of 5 tripwires tripped — ROCE stays above 8%; Valuation vs its own median of 6.8x · see Key things to watch ↑